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Grocer says data breach could cost $80M in Illinois

By Becky Yerak
Chicago Tribune

A data breach at a St. Louis-based grocery store chain could cost the family-run company $80 million in Illinois alone, according to a court filing.

Schnuck Markets Inc., which has more than 30 stores in the Rockford area and in downstate Illinois, disclosed last month that between December 2012 and March 29, 2013, about 2 million credit and debit cards used at most of its stores might have been compromised by what they believe is a criminal hacking.

Lawsuits against the company, run by the third generation of the Schnuck family, have ensued, though the retailer has said no cardholder names or addresses have been accessed.

In a court filing last week, Schnucks sought to remove a case from Illinois’ St. Clair County Court to a federal civil court in the Southern District of Illinois. Such courts have jurisdiction when the potential class action includes residents of another state, the amount involved exceeds $5 million, and the class has more than 100 people, the company said.

The grocer laid out the math in its filing: It notes that, based on the plaintiff’s allegations, the class could be as large as 500,000. If each one spent at least two hours of “time and effort” dealing with the breach – even if they were minimum-wage workers being paid $7.25 an hour – the potential damage could be $7.25 million, says Schnuck, which also has stores in Champaign, Urbana, Peoria, Springfield, Normal, DeKalb and Roscoe.

Furthermore, Schnucks points out, the Illinois Supreme Court has in the past approved a ratio of punitive to compensatory damages of about 11 to 1.

That could mean nearly $80 million in potential damages for Schnucks.

Schnucks spokeswoman Lori Willis said Thursday that the lawsuit has “no merit.”Adds the company in its court document: “In filing this notice of removal, Schnucks does not concede liability on any of the claims asserted in plaintiff’s complaint.”